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Real Estate - Home Equity and Foreclosure rules, implications

San Francisco, CA |

I have substantial equity in a single family home and would liek to take out a home equity loan against my equity. If I lose my job and then unable to pay both mortgage & loan er-payments, what are the implications? Can the home be foreclosed?

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Attorney answers 2


The simple answer is that if you lose your job and could not pay the HELOC, you could lose your home to a foreclosure. You should consider your ability in the future to pay back the loan before taking out a loan.


In taking out a second mortgage or Home Equity Line of Credit, you are agreeing to the same thing that you agreed in your original mortgage. That is, the loan is secured by your real estate. You will generally sign a deed of trust indicating that the lendor has an interest in your real estate that will be claimed if they are not re-payed. If you don't pay, they foreclose on the real estate in hopes of recovering their money. Good Luck.

David C. Beyersdorf
Lee & Beyersdorf, Llp
2110 North Winery Avenue, Suite #101
Fresno, CA 93703
(559) 252-7000